Home

Top Jobs
43008BR: Associate Director, Green Building Services
Project Manager, Green Building Services
Sustainable Energy Specialist
Energy Systems Engineer
Director, Energy Planning & Innovation
Energy Manager
Manager NYEM Advisory and Training Services Program
ENERGY MANAGEMENT SPECIALIST-TEMPE CAMPUS
Program Manager
Senior Energy Programs Coordinator
Submit a Position
Find a Position

Upcoming Events
The Renewable Energy Mini MBA
etc.venues, 8 Fenchurch Place, London, EC3M 4PB, United Kingdom,
8/21/17 - 8/25/17
AESP 2017 National Conference
Loews Royal Pacific Resort Orlando, FL,
8/29/17 - 8/31/17
THE GREEN EXPO 2017
World Trade Center, Montecito 38 Napoles, Benito Juarez, Mexico City 03810, Mexico,
9/5/17 - 9/7/17
Geological Society - Building Resilience to Geohazards
The Geological Society, Burlington House, London, W1J 0BG, United Kingdom,
9/7/17 - 9/8/17
Geological Society - Building Resilience to Geohazards
The Geological Society, Burlington House, London, W1J 0BG, United Kingdom,
9/7/17 - 9/8/17
Submit an Event
View All Events


Sain Featured Employer

After Eight Years, PACE Program Poised to Launch in Virginia

 

Follow energycareer on Twitter

Sign-Up for Free Energy, Facility, Power Newsletter (EFPN) newsletter

 

 

 

The long road to financing energy efficiency improvements on the tax bills of commercial properties in Virginia is reaching the home stretch. Arlington County in northern Virginia has secured a program administrator – Sustainable Real Estate Solutions – a critical step in getting started with the state’s first Property Assessed Clean Energy, or PACE, program. Managers there are preparing to submit final guidelines to the county’s Board with the goal of launching a program this summer.

Meanwhile, other local governments, energy contractors and would-be capital providers are tracking Arlington County’s progress.

Virginia lawmakers originally authorized local governments to pursue PACE programs in 2009. But procedural glitches hampered Arlington County’s implementation that weren’t corrected until lawmakers fine-tuned the authorizing legislation until 2015. Two years later, Charlottesville, Hampton Roads, Richmond and Roanoke are municipalities keeping a close eye on Arlington’s progress, as is Loudoun County, also in northern Virginia.

PACE enables property owners to borrow funds for energy improvements on existing buildings such as installing more efficient air conditioning systems, better insulation and solar panels. The participants then pay back the money together with property taxes as an adjunct to the property tax bills. The terms on PACE loans can vary up to 20 years. The interest rates typically are slightly above market rates for mortgages.

Savings from lower heating and cooling bills can be large enough to cover the full cost of repaying PACE loans from the outset. That means the owner has no outlays upfront and no added costs in making the property improvements. Communities also gain because banks and contractors get new business and they can lead by example in developing increasingly sought-after “smart city” real estate developments.

“It can cover 100% of a building project’s hard and soft costs, meaning the materials, the labor and the analysis and energy audits,” said Richard Dooley, Arlington County’s Community Energy Coordinator. “The owner is given the ability to improve a property without having to tap into its capital.”

Dooley said the longer terms – up to 20 years on a PACE loan versus 7 years on a conventional loan – make the deals more attractive for financial officers. “That allows for these projects to often be cash-flow positive from day one; or cash-flow positive in the very early years,” Dooley said.

PACE programs have struggled to get a footing in the Southeast U.S. largely due to the lack of a critical mass of advocates, lawmakers willing to learn and private sector allies. They often find themselves at odds with bankers wary of the mortgages they grant having to compete with another lien in the event of a default.

With the right policies in place, PACE can work for residential, as well as, commercial properties as they are authorized in Florida. Virginia, however, is trying first with commercial-only PACE programs.

Several municipalities are monitoring Arlington County’s program for clues on how to best develop their PACE efforts.

Alicia Zatcoff, Richmond’s sustainability manager, said, “We’re very closely watching Arlington and the progression and development of their program. We’re very interested in not re-inventing the wheel.”

Several other states have moved relatively quickly launching PACE programs. Typically, where lawmakers enable markets for renewable energy, competitive electricity supplies and efficiency products and services, those states have or are becoming active with PACE programs. These include California, Colorado, Connecticut, Ohio, Minnesota and Texas, to name a few. This week, PACE advocates and professionals are gathering in Denver for their annual summit.

Despite having enabled the second-largest market for solar energy in the country behind only California, North Carolina has struggled with PACE mostly because commercial bankers are not yet on board, said Abigail Johnson, the CEO of Abacus Property Solutions in Williamsburg, Virginia, who helps develop PACE programs in many states and is active in Virginia.

Johnson estimates that at least $100 million worth of commercial PACE projects are achievable throughout Virginia within five years. She sees PACE in Virginia appealing mostly “to those (building owners) who are less credit-worthy or are highly (leveraged) and those who don’t have a huge second mortgage on their balance sheet.”

“It really depends on how quickly jurisdictions opt in,” Johnson said. Virginia may need that much and more if it is to achieve its stated goal of reducing retail electricity consumption 10% by 2020 compared to 2014.

Drawing from a study completed by Virginia Community Capital of 35 local governments, Zatcoff said many of them “would like to see a statewide program with one uniform approach to doing PACE.”

Return Home

 

Follow energycareer on Twitter